On August 28, the average sales-to-output ratio of polyester filament sample enterprises was only 34.7%. Although this figure rebounded by 5.3 percentage points from the previous trading day, downstream buyers' resistance to high prices remained strong. Inquiries were sluggish, and transactions were in a stalemate, reflecting a typical 'price war' where sellers refuse to cut prices and buyers refuse to accept them.
Data Behind the Market
A sales-to-output ratio of 34.7% means that over 60% of production capacity failed to convert into actual transactions. According to sample enterprise data, the daily ratio ranged from 0% to 500%, but the vast majority of enterprises hovered between 10% and 40%, with only a few achieving oversold status. This extreme divergence indicates that demand is not entirely shrinking but is highly concentrated among suppliers with price advantages or strong customer loyalty.
More notably, the ratio's rebound of 5.3 percentage points from the previous day might seem like a sign of demand recovery, but given the market description of 'downstream resistance to high prices,' it is more likely a technical rebound—some rigid orders were forced to accept high prices rather than a trend reversal. For buyers, the current price signals may be distorted, and actual transaction conditions are far more complex than surface data suggests.
Supply Chain Transmission
The price stalemate in polyester filament is essentially a redistribution of costs and profits along the supply chain. High upstream raw material costs compress the profit margins of polyester filament producers, leaving limited room for price cuts. Meanwhile, downstream weaving enterprises, facing high raw material prices, lack the ability to raise their own product prices and can only reduce purchases to pressure upstream concessions. This two-way squeeze keeps all links in the chain in a wait-and-see mode, with inventory pressure gradually accumulating upstream.
Historical experience shows that such stalemates rarely last long. When the sales-to-output ratio stays below 40% for several consecutive days, inventory pressure often forces some factories to alleviate cash flow tension through promotions or price cuts. Currently, we are in the traditional stocking period for the peak season, but downstream caution may indicate that peak season expectations are being revised by reality. For polyester filament producers, balancing profit retention and inventory reduction will be a critical challenge in the coming weeks.
Peak Season Expectations Tested
Late August is typically the stocking window for the 'golden September and silver October' in the textile industry, but this year's market performance has not inspired confidence. Downstream resistance to high prices reflects that terminal demand has not shown strong recovery, and the sustainability of brand orders is questionable. The market's previous optimism about the peak season is being eroded by the reality of low sales-to-output ratios.
Feedback from industrial clusters indicates that operating rates of weaving enterprises in Jiangsu and Zhejiang have not significantly increased, and some small and medium-sized factories have even opted for staggered production or reduced shifts. This suggests that even if polyester filament prices soften, actual purchase volumes may fall short of expectations. For traders, it is not advisable to blindly hoard inventory; instead, they should closely monitor substantive changes in terminal orders.
Practical Recommendations
For Buyers - Batch procurement: Avoid large one-time inventory build-ups; adopt a 'small batches, multiple times' strategy to reduce price fluctuation risks. - Monitor inventory data: If polyester filament factory inventories rise for two consecutive weeks, downward price pressure will increase, and procurement can be appropriately delayed. - Lock in forward contracts: If raw material costs are expected to rise, negotiate short-term price-lock agreements with suppliers to hedge against price increases.
For Foreign Trade Enterprises - Flexible quotations: Include raw material price linkage clauses in export quotations to prevent domestic raw material fluctuations from eroding profits. - Diversify suppliers: Beyond polyester filament, evaluate the feasibility of alternative or recycled fibers to cope with price stalemates. - Watch exchange rates and logistics: Recent exchange rate fluctuations and shipping cost changes may affect actual transaction prices; clarify relevant terms in contracts.
The market remains in a stalemate, but the stalemate itself is a signal. When sales-to-output ratios stay low for an extended period, the price balance will eventually tip toward the demand side. Both buyers and suppliers need to be prepared for a potential price adjustment window.